Is crypto currency the largest financial fraud ever?

[craig]

The almost 30% drop in crypto currency investments over the last month prompted me to do some research and I found this article:

Cryptocurrency Is a Giant Ponzi Scheme

Cryptocurrency is not merely a bad investment or speculative bubble. It’s worse than that: it’s a full-on fraud.

jacobinmag.com

As a former software engineer the discussion of the technology seems accurate but my layman's knowledge of finance does not allow me to judge that aspect of the article though it appears to be dangerous to our financial system. China and India have virtually banned crypto currencies and perhaps for good reason. Can anyone else provide incite.

Like ‘The 1929 Crash’—New Crypto Winter Warning As Sell-Off Wipes $1.5 Trillion From The Combined Bitcoin, Ethereum, Solana, BNB, Cardano And XRP Price

A new "crypto winter" could be around the corner after a huge crypto price crash has wiped $1.5 trillion from the combined cryptocurrency market—hitting bitcoin, ethereum, BNB, solana, cardano and XRP hard...

www.forbes.com

Crypto is crashing—and experts predict more pain ahead

Stalwart coins like Bitcoin have shed over 40% in recent months.

fortune.com

 

[Rexedgar]

When Steve Bannon gets involved, there should be aa red flag!

Bannon Touts Cryptocurrency $FJB for Trump Supporters to 'F Joe Biden'

The website for the new right-wing cryptocurrency claims it will help those who buy it "fight" for America.

www.newsweek.com

Scaramucci has been hawking Bitcoin since leaving the short stop at Trump’s WH.

 

[Phys251]

The almost 30% drop in crypto currency investments over the last month prompted me to do some research and I found this article:

Cryptocurrency Is a Giant Ponzi Scheme

Cryptocurrency is not merely a bad investment or speculative bubble. It’s worse than that: it’s a full-on fraud.

jacobinmag.com

As a former software engineer the discussion of the technology seems accurate but my layman's knowledge of finance does not allow me to judge that aspect of the article though it appears to be dangerous to our financial system. China and India have virtually banned crypto currencies and perhaps for good reason. Can anyone else provide incite.

Like ‘The 1929 Crash’—New Crypto Winter Warning As Sell-Off Wipes $1.5 Trillion From The Combined Bitcoin, Ethereum, Solana, BNB, Cardano And XRP Price

A new "crypto winter" could be around the corner after a huge crypto price crash has wiped $1.5 trillion from the combined cryptocurrency market—hitting bitcoin, ethereum, BNB, solana, cardano and XRP hard...

www.forbes.com

Crypto is crashing—and experts predict more pain ahead

Stalwart coins like Bitcoin have shed over 40% in recent months.

fortune.com

Crypto will crash someday. It has to. It's only a matter of when.

 

[Rexedgar]

Crypto will crash someday. It has to. It's only a matter of when.

If I can’t stuff it in my mattress, it is of no use to me….

 

[Threegoofs]

Crypto is ridiculous. And the people who are into it are looking at it as a get rich quick scheme, which works for a few, but most will be crushed.

The line last year was that crypto is a great hedge against inflation. Guess that didnt pan out…

 

[Queen Margo]

What goes up, must come down, spinning wheels got to go round...

 

[BirdinHand]

Crypto is based off absolutely nothing. It is a complete shell game.

If you can make some quick money, do it.

But don’t risk anything you can’t afford to lose.

 

[WillyPete]

I'm no financial expert, but honestly there's not a significant difference between cryptocurrency and physical money. That's something we could all adjust to.

I'm told it's the underlying blockchain technology that is going to change our lives, because it provides a universally verifiable history of ownership (of anything it is applied to.)

I worked in the financial industry a bit, and I can confirm that all over the world there are offices full of people whose job it is to verify ownership of houses and cars and everything else we've got.

This technology potentially replaces all of them, and any jerk with a cell phone will be able to 100% verify the ownership history of anything in the system.

 

[JMB802]

The energy-guzzling by crypto miners is astounding to me.

Bitcoin Uses More Electricity Than Many Countries. How Is That Possible? (Published 2021)

The most popular cryptocurrency wastes energy by design. Why is that, and could it ever be greener?

www.nytimes.com

 

[craig]

I'm no financial expert, but honestly there's not a significant difference between cryptocurrency and physical money. That's something we could all adjust to.

I'm told it's the underlying blockchain technology that is going to change our lives, because it provides a universally verifiable history of ownership (of anything it is applied to.)

I worked in the financial industry a bit, and I can confirm that all over the world there are offices full of people whose job it is to verify ownership of houses and cars and everything else we've got.

This technology potentially replaces all of them, and any jerk with a cell phone will be able to 100% verify the ownership history of anything in the system.

The problem I see is that verifying providence or ownership of digital information does not tie that information to anything physical. That is if a description of a physical asset in a verified piece of information does not prevent another description of the same physical asset from being in another verified piece of information. It is the age old problem that the name (description) of a thing is not the thing itself.

 

[Threegoofs]

I'm no financial expert, but honestly there's not a significant difference between cryptocurrency and physical money. That's something we could all adjust to.

I'm told it's the underlying blockchain technology that is going to change our lives, because it provides a universally verifiable history of ownership (of anything it is applied to.)

I worked in the financial industry a bit, and I can confirm that all over the world there are offices full of people whose job it is to verify ownership of houses and cars and everything else we've got.

This technology potentially replaces all of them, and any jerk with a cell phone will be able to 100% verify the ownership history of anything in the system.

Yet if you lose your bitcoin wallet, you can never get it back.
Kinda dumb to have a verifiable history of ownership but not being able to access it.

 

[WillyPete]

The problem I see is that verifying providence or ownership of digital information does not tie that information to anything physical. That is if a description of a physical asset in a verified piece of information does not prevent a description of the same physical asset from being in another verified piece of information.

Not sure. I don't completely get it myself. I understand it does depend on the maintenance for the servers involved.

I guess in many/most cases they can pack in enough defining information to make it work (like the exact coordinates for real estate, or serial numbers or just accurate records tracking it's history from the factory.

The claim is when you buy something, the record just flags it as yours, and the entire world sees it happen, and has the means to verify it.

If they can deliver that, it would be pretty big.

 

[PirateMk1]

The problem I see is that verifying providence or ownership of digital information does not tie that information to anything physical.

Bitcoin is software. As a currency it is based on the faith of those use it as there are NO assets to back it, similar to what the dollar is nowadays. Being a form of fiat currency bitcoin and others it, does have certain advantages and disadvantages over regular currency, however my main point is that bitcoin is virtual fiat currency and therefore subject to the same pressures and downfalls as regularly fiat currency along with its own unique peculiarities.

 

[WillyPete]

Yet if you lose your bitcoin wallet, you can never get it back.
Kinda dumb to have a verifiable history of ownership but not being able to access it.

Well yeah, I don't dabble in that myself. I think what we have today are just the early, crude fast profit driven versions of what that system can do.

Crypto currencies may or may not change things anytime soon, but market forces will basically guarantee that blockchains are used in the future, if they perform.

 

[craig]

Bitcoin is software. As a currency it is based on the faith of those use it as there are NO assets to back it, similar to what the dollar is nowadays. Being a form of fiat currency bitcoin and others it, does have certain advantages and disadvantages over regular currency, however my main point is that bitcoin is virtual fiat currency and therefore subject to the same pressures and downfalls as regularly fiat currency along with its own unique peculiarities.

My argument would be that fiat currency is backed by a sovereign state which manages and maintains the currencies ability to be be used to purchase physical stuff. The more trust in the sovereign state the more stable and liquid the currency. Block chain technology does not provide that function.

 

[Monica33]

The almost 30% drop in crypto currency investments over the last month prompted me to do some research and I found this article:

etc

I can find you hundreds of articles written within the financial 'trade' that suggest the complete opposite .

After the imminent markets collapse you can argue whether BTC will be seen as a future hard asset like precious metals and Gold and Silver in particular .


Assuming a huge markets depression --- a certainty --- why gamble further with BTC when you can make a fortune with Silver and Gold as stone bonking certainties ?

Separately you can make a strong argument that Etherium will outperform BTC .

 

[Phys251]

I can find you hundreds of articles written within the financial 'trade' that suggest the complete opposite .

After the imminent markets collapse you can argue whether BTC will be seen as a future hard asset like precious metals and Gold and Silver in particular .


Assuming a huge markets depression --- a certainty --- why gamble further with BTC when you can make a fortune with Silver and Gold as stone bonking certainties ?

Separately you can make a strong argument that Etherium will outperform BTC .

Aside from inflation, the economy is doing just fine. You're supposed to hawk silver and gold when the economy is in bad shape.

 

[PirateMk1]

My argument would be that fiat currency is backed by a sovereign state which manages and maintains the currencies ability to be be used to purchase physical stuff. The more trust in the sovereign state the more stable and liquid the currency. Block chain technology does not provide that function.

As far as I am concerned they are both the same as currency.

 

[craig]

I can find you hundreds of articles written within the financial 'trade' that suggest the complete opposite .

After the imminent markets collapse you can argue whether BTC will be seen as a future hard asset like precious metals and Gold and Silver in particular .


Assuming a huge markets depression --- a certainty --- why gamble further with BTC when you can make a fortune with Silver and Gold as stone bonking certainties ?

Separately you can make a strong argument that Etherium will outperform BTC .

I also read many other articles but found nothing that refuted what was in the article I posted. Please link to those that do.

 

[mrjurrs]

The almost 30% drop in crypto currency investments over the last month prompted me to do some research and I found this article:

Cryptocurrency Is a Giant Ponzi Scheme

Cryptocurrency is not merely a bad investment or speculative bubble. It’s worse than that: it’s a full-on fraud.

jacobinmag.com

As a former software engineer the discussion of the technology seems accurate but my layman's knowledge of finance does not allow me to judge that aspect of the article though it appears to be dangerous to our financial system. China and India have virtually banned crypto currencies and perhaps for good reason. Can anyone else provide incite.

Like ‘The 1929 Crash’—New Crypto Winter Warning As Sell-Off Wipes $1.5 Trillion From The Combined Bitcoin, Ethereum, Solana, BNB, Cardano And XRP Price

A new "crypto winter" could be around the corner after a huge crypto price crash has wiped $1.5 trillion from the combined cryptocurrency market—hitting bitcoin, ethereum, BNB, solana, cardano and XRP hard...

www.forbes.com

Crypto is crashing—and experts predict more pain ahead

Stalwart coins like Bitcoin have shed over 40% in recent months.

fortune.com

Might be. I'm no financial wizard but even I know that an investment vehicle that is fiat money AND intangible relies on faith more than reality.

 

[Fledermaus]

Aside from inflation, the economy is doing just fine. You're supposed to hawk silver and gold when the economy is in bad shape.

I love the ads that speak of Silver reserves diminishing... As Mexico pulls about 1.8 million ounces out the the ground annually.

 

[georgephillip]

The almost 30% drop in crypto currency investments over the last month prompted me to do some research and I found this article:

Cryptocurrency Is a Giant Ponzi Scheme

Cryptocurrency is not merely a bad investment or speculative bubble. It’s worse than that: it’s a full-on fraud.

jacobinmag.com

As a former software engineer the discussion of the technology seems accurate but my layman's knowledge of finance does not allow me to judge that aspect of the article though it appears to be dangerous to our financial system. China and India have virtually banned crypto currencies and perhaps for good reason. Can anyone else provide incite.

Like ‘The 1929 Crash’—New Crypto Winter Warning As Sell-Off Wipes $1.5 Trillion From The Combined Bitcoin, Ethereum, Solana, BNB, Cardano And XRP Price

A new "crypto winter" could be around the corner after a huge crypto price crash has wiped $1.5 trillion from the combined cryptocurrency market—hitting bitcoin, ethereum, BNB, solana, cardano and XRP hard...

www.forbes.com

Crypto is crashing—and experts predict more pain ahead

Stalwart coins like Bitcoin have shed over 40% in recent months.

fortune.com

I lack your knowledge of software and I'm relatively ignorant of basic finance; however, I regularly read someone who has spent years working on Wall Street, and she believes Warren Buffet is exactly correct about Bitcoin:

https://wallstreetonparade.com/2022...r-the-biggest-bubble-since-12000-tulip-bulbs/

"Bitcoin, called 'rat poison squared' by Warren Buffett, one of the smartest investors of all time, is not a thing of beauty, has nothing backing it, and is currently in free fall.

"After trading as high as $69,355 in November on the CME’s futures market, its front month futures contract closed at $36,725 on the CME today, a dive of 47 percent from its previous high.

Bitcoin was supposed to be the digital replacement for gold – a safe haven in a financial selloff.

"But Bitcoin, which along with other crypto currencies can be leveraged by hedge funds on a 100 times to 1 basis, closed down 13.94 percent on the CME today while the tech and SPAC bubble known as the Nasdaq stock market, closed down 2.72 percent on the day."

It sound like another example of rich people getting richer by siphoning wealth upwards from those less knowledgeable?

 

[Checkerboard Strangler]

The energy-guzzling by crypto miners is astounding to me.

Bitcoin Uses More Electricity Than Many Countries. How Is That Possible? (Published 2021)

The most popular cryptocurrency wastes energy by design. Why is that, and could it ever be greener?

www.nytimes.com

And crypto doodz, many who ID as futurists, aren't even the least bit interested in renewable energy to POWER their enormous blockchain computing farms.
Thus, they might as well be in the same frame of reference as mid-century coal barons of yore, it's just raping and pillaging the earth with 1's and 0's instead of strip mining, taconite and coal ash.

Crypto dudes are this century's "Diamond Direct Distributors" of Amway lore.

 

[multivita-man]

Crypto will crash someday. It has to. It's only a matter of when.

There's a market and utility for blockchain, but all of these different meme coins are just absurd. They are absolutely Ponzi schemes - very similar to the the dot coms that peaked in the late 90s and then crashed when everyone realized the jig is up.

 

[multivita-man]

It sound like another example of rich people getting richer by siphoning wealth upwards from those less knowledgeable?

It's easy to see how BTC can become corrupted. Like pretty much all virtual currencies, it takes a few 'whales' to get it going. BTC basically works by getting other suckers to join in with the assumption that it's an "investment." More people join in, the money pot grows, and then when it crests, the bigger players sell, often leaving the noobs holding the bag. Then the price goes down, the whales jump back in, and the cycle continues. The big money boys basically control the price. It's not like currency which is regulated and influenced by policy. It's not like stock or commodity prices which are influenced by well-established market forces.

I can absolutely see a reason for the existence of blockchain technology, and perhaps somewhere down the line, there could be an international agreement on what a single virtual currency should be, but right now, bitcoin/memecoin/whatevercoin is just the wild, wild West. People are going to get screwed, and crypto's continued creep into mainstream banking should worry all of us. Market crashes are almost always the result of over-speculation about things people don't understand, like real estate in the 1920s, dot coms in the 1990s, and mortgage-backed seurities in the 00s. This is the next big crash in the making, and I wouldn't be surprised if it happens this year.